Questions from Federal Taxation

Q: Johnson & Johnson announced that it had entered into a merger agreement

Johnson & Johnson announced that it had entered into a merger agreement with Alza Corporation, a research-based pharmaceutical company and a leader in drug delivery technologies. In a nontaxable reorg...

Q: Rodger Powell owns all the stock in Fireside Bar and Grill Corporation

Rodger Powell owns all the stock in Fireside Bar and Grill Corporation in Pittsburgh. Now that he has turned 65, Rodger wants to sell his business and retire to sunny Florida. Karin Godfrey, a long-ti...

Q: Adolph Coors Co. transferred part of its assets to ACX Technologies

Adolph Coors Co. transferred part of its assets to ACX Technologies Corporation in exchange for all of ACX’s stock. The transferred assets included its aluminum unit, which makes aluminum sheet; its p...

Q: Sara transfers land (a capital asset) having a $30

Sara transfers land (a capital asset) having a $30,000 adjusted basis to Temple Corporation in a Sec. 351 exchange. In return, Sara receives the following consideration: Consideration …………....………….....

Q: At the close of business on May 31, 2017, Alaska

At the close of business on May 31, 2017, Alaska Corporation exchanges $2 million of its voting common stock for all the noncash assets of Tennessee Corporation. Tennessee uses its cash to pay off its...

Q: At the beginning of the current year, Allegro Corporation acquires all

At the beginning of the current year, Allegro Corporation acquires all of Tempo Corporation’s stock in a Type B reorganization. At the time of the acquisition, Tempo’s stock has a $900,000 FMV, and Te...

Q: Alpha Corporation purchased 20% of Theta Corporation’s stock on each of

Alpha Corporation purchased 20% of Theta Corporation’s stock on each of the following dates in the current year: January 2, April 1, June 1, October 1, and December 31. a. Has a qualified stock purch...

Q: Alpha Corporation purchases 20% of Theta Corporation stock from Milt on

Alpha Corporation purchases 20% of Theta Corporation stock from Milt on August 10 of the current year. Alpha purchases an additional 30% of the stock from Nick on November 15 of the current year. Alph...

Q: Gator Corporation is considering the acquisition of Bulldog Corporation’s stock in exchange

Gator Corporation is considering the acquisition of Bulldog Corporation’s stock in exchange for cash. Two options are under review: (1) Gator purchases the assets from Bulldog for $1...

Q: J.S. Bachman owns 100% of Legato Corporation’s stock

J.S. Bachman owns 100% of Legato Corporation’s stock, having a $350,000 basis. On December 31 of the current year, Legato Corporation reported the following balance sheet: Staccato...